Hi-
I am currently in the middle of a strange paypal transaction and am worried I will be out $550. I "rented" a vacation rental for the weekend off of craigslist and left a deposit on PayPal. After I made the payment, the seller almost immediately issued a refund and said, "Hello, There is a little problem with the paypal account and I am issuing a refund right away.I would still keep the vacation home for you while I sought other purposes to recieve the payment. Thanks Burge" Then he sent another email address to use. By this point, I discovered this person had nothing to do with the property I was renting. I ignored this attempt at sending another payment.
I figured I dodged a bullet because the refund was issued. However, there is a Temporary Hold placed on the refund. According to PayPal's help, that means "There were not enough funds in your seller's PayPal account to cover the refund, so the funds are being transferred from the seller's bank account. Once the bank account transfer is completed, you'll receive your refund."
How does this scam work? I paid him $550, he has $550 (minus fees) in his account, he issues a refund and there's not enough to cover the refund? Does that mean that the account was cleaned out before the refund was issued? Does PayPal allow a refund to be issued with a $0 balance account? Can it be that both funding sources are invalid and PayPal doesn't know?
Also, I can not dispute the charge because a refund has already been issued.
